Meltdown will hobble next president's 100-day sprint

By Mike Dorning 3 November 2008

Chicago Tribune (MCT)

WASHINGTON - Ever since Franklin Roosevelt took office with the passage of a torrent of historic legislation, the first 100 days of a new presidency have taken on a mythic significance as a moment to set the tone for a new White House and enact signature laws.

But with the huge cost of the Wall Street bailout and a ballooning budget deficit that could be worsened by recession, resources will be sharply constrained this time. Restoring the economy’s overall health will be the overwhelming task of the new president and Congress, drowning out most other priorities.

Barack Obama’s ambitious agenda includes a national health care plan, a middle-class tax cut and major investments in alternative energy, education and infrastructure. But he has brushed aside questions about potential trade-offs among his priorities once elected, leaving considerable ambiguity about how he would proceed.

John McCain’s promise to extend the Bush tax cuts and add new tax breaks for corporations and investors is certain to run into a roadblock if Democrats expand their control of Congress as expected.

The Republican’s health care plan is even less likely to pass, since it relies on eliminating a popular tax break for employer-provided health care, which would be anathema to a Democratic Congress and stir strong opposition from business and labor groups.

“Both of them have promised many policy initiatives,” said James Pfiffner, a public policy professor at George Mason University and author a book on presidential transitions. “But it’s highly unlikely either one of them could get a lot of important legislation through Congress in the first year, particularly when Congress is so polarized.”

Either candidate would, of course, have considerably more leeway to pursue his strategy in Iraq, given the powers of the commander in chief. Yet the new president still may have to adjust course in Iraq to accommodate changes on the ground and the responses of regional powers such as Iran, Syria, Saudi Arabia and Turkey.

Both campaigns have quietly set up transition planning operations to prepare for a new administration, with Clinton White House chief of staff John Podesta leading the process for Obama and Reagan administration Navy Secretary John Lehman managing it for McCain.

The nonpartisan Committee for a Responsible Federal Budget found that - even assuming the sometimes-dubious savings the campaigns claim - both the Obama and McCain plans would add more than $200 billion to the federal deficit by 2013. And that estimate was compiled in September, before the candidates announced costly new economic stimulus proposals.

The choices an incoming Obama administration would confront in many ways resemble those facing Bill Clinton after he won in 1992, another time of recession and swelling budget deficits.

Like Obama, Clinton campaigned on an expansive agenda. Clinton promised a middle-class tax cut, national health care reform, a stimulus package and a major infrastructure investment program.

But once in office, Clinton focused his attention on reducing the federal deficit, as a result of a fierce internal policy debate in which centrist advisers led by future Treasury Secretary Robert Rubin prevailed over liberals led by Labor Secretary Robert Reich. The middle-class tax cut and infrastructure investment plans were shelved. The economic stimulus failed in Congress; health care reform was postponed and later died.

Obama has resisted telegraphing much about how he would choose among his goals, though he has given some indications. In one debate, he ranked energy independence as his highest domestic priority, followed by health care reform and then education; McCain declined to rank his priorities when asked the same question, saying Americans had the capacity to tackle these priorities at the same time.

Responding to a donor’s question at a fundraiser in May, Obama said his top goals for his first 100 days in office would include proposing legislation on his health care plan by “March or April” and an immediate “signal to the world” on the nation’s commitment to alternative energy.

That signal could be something less ambitious than the $15 billion-a-year energy plan Obama touts on the campaign trail. Obama might make a dramatic personal appearance at the international climate change negotiations scheduled to begin in December, or order the Environmental Protection Agency to regulate greenhouse gas emissions. The advantage of such acts: neither requires public money or congressional approval.

Obama also mentioned completing the advance military planning to begin withdrawing troops from Iraq.

But all this was before the economic crisis.

“The next president is going to face an even greater challenge than President Clinton faced,” said former Clinton White House chief of staff Leon Panetta. “That means the next president is going to have to limit, if not postpone, a lot of the promises that have been made in order to confront the major challenge, which is to provide stability in the economy and federal budget.”

McCain has said he will propose a one-year freeze on all discretionary spending not related to defense or veterans. That initiative, too, would face steep odds in a Democratic-controlled Congress.

Beyond the financial constraints, the White House must deal with a Congress that moves slowly on major legislation and has difficulty tackling more than one big issue at a time. Jimmy Carter and Bill Clinton are widely viewed as having squandered opportunities by pursuing a muddle of initiatives at the outset, while Ronald Reagan and George W. Bush benefited from lean, focused agendas.